Chancellor to confirm Middlesbrough and Hartlepool as “turbocharged” Investment Zones

Chancellor of the Exchequer Kwasi Kwarteng is expected to announce today in a Growth Plan that the Tees Valley will become one of the first areas in the UK to pilot new economy-boosting Investment Zones.

Middlesbrough and Hartlepool Mayoral Development Corporations are set to be the first two areas put forward by the Tees Valley Mayor and will be up and running by the end of the year.

Investment Zones aim to “turbocharge” development, investment and job creation by applying similar tax incentives for businesses to those found in Freeports, but in doing so increasing incentives and “cutting more red tape”.

As it currently stands, half of the business rates go to Local Authorities, with the remaining half going to central Government. Under new Investment Zone proposals for new rate-payers within the zones, it is understood that 50 per cent will go to Local Authorities and 50 per cent will be retained by the Mayor to reinvest in projects that will boost the region.

Changes to capital allowance rules and Employers National Insurance contributions will also increase private sector investment into these areas as they benefit from the reduced costs.

Tees Valley Mayor Ben Houchen commented: “These new Investment Zones will supercharge what we’re setting out to do with new Mayoral Development Corporations in Middlesbrough and Hartlepool and, as with the Teesside Freeport, we’re once again leading the way in doing things differently.

“These plans will go even further than before to boost local, national and international investment in our town centres, at a time when all eyes are already on us.

“We know what our region needs better than anyone, so by keeping all of the money from these investments in our region, rather than being in the hands of Whitehall to control, we’ll be able to reinvest it to deliver on local development priorities.

“It’s a great cycle – as more businesses locate themselves here, we’ll have more funding to improve our towns, in turn attracting more companies, generating even more cash for regeneration. All the while, they’ll be creating the good-quality, well-paid jobs we need in our town centres, without a penny being paid by the taxpayer.

“This is a chance to create town centres we can be proud of in Middlesbrough and Hartlepool by lowering taxes, simplifying planning and securing private sector investment even sooner. These Investment Zones will usher in a new age of investment so we can play to our strengths and take advantage of new opportunities for years to come.”

By Matthew Neville – Correspondent, Bdaily

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